Is this “operation” a dream or not? Only empty promises and more corruption? South Africa’s oceans – if exploited and managed properly could add one million jobs to the economy and R177 billion to the country’s gross domestic product by 2033 – President Jacob Zuma. Nevermind Soekor – they are history!!

During 2013 Mr Dangota warned South Africa against BEE /

Nigerian billionaire businessman Aliko Dangote has sharply criticised South Africa’s black economic empowerment (BEE) laws, calling them an obstacle to investment from other African states and a brake on intracontinental trade. Speaking to Business Day on the sidelines of the South Africa-Nigeria Business Forum on Tuesday, Mr Dangote said: “In Nigeria, we had these laws demanding that any (foreign) investor had to have a Nigerian partner. But that just dried up the capital flows. Now anyone can do business with anyone in Nigeria.” Mr Dangote said South Africa’s BEE laws and policies would have to be reviewed in order to attract more investment from Africa to South Africa and to encourage all Africans to participate in South Africa’s economy. Mr Dangote said South Africa’s BEE rules and regulations benefited only 5%-10% of the population.

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Health Care is part of Phakisa

Government is working on a plan to improve the country’s clinics. A team of experts from various departments, including the private sector, are in the process of designing a model for an ideal clinic which can be replicated across the country. This was revealed by Health Minister Aaron Motsoaledi at the opening of the three day Hospital Association of South Africa conference in Sandton on Wednesday. Motsoaledi says primary health care is an important foundation for a well-functioning health system. “The ideal clinics must never run out of electricity, out of water, they must have a good sanitation system, there must be paperless technology in terms of filing system, and they must never struggle to get medicines and so on. We have got 10 such clinics in SA already. The people I’ve locked in on Sunday, my instruction to them was make the 3000 clinics in SA to look like these ten.”

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During February 2014, Health Minister Aaron Motsoaledi addressed media during a post-State of the Nation Address briefing in Cape Town announced that within the next five years, the department will also refurbish and re-equip 870 clinics in the 11 pilot districts of NHI. “This has greatly increased access to healthcare. We have asked our medical schools to try and over stretch themselves and we are happy that they have obliged. “In 2012, 220 additional medical students, who would ordinarily not be admitted to medical schools, were actually enrolled. This figure increased to 425 across our medical schools,” said the minister. Today, there are 2 074 South African students from rural areas and disadvantaged backgrounds studying medicine in Cuba. The department decided to upgrade the programme from the traditional 60 students per annum at inception of the programme to about a 1 000 per annum since 2012.

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Malaysia’s model

“Operation Phakisa is designed to answer that fundamental question — how do we turn our good plans into action to improve the lives of our people and to make the National Development Plan come alive,” President Zuma said. Operation Phakisa is an adaptation of the Big Fast Results methodology that was successfully applied by the Malaysian government in the delivery of its economic and government transformation programmes. In 2010, the ocean contributed around R54 billion to South Africa’s gross domestic product and accounted for approximately 316,000 jobs.

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South Africans do not always agree as expected:
Respondents to our Operation Phakisa survey were unanimous in their view that the maritime industry has the capacity to cater for new entrants with 71 percent deeming it “realistic” and a further 29 percent seeing it as “very realistic”. Just under 30 percent, however, believe that it is unrealistic to expect the maritime industry to create one million jobs and for the blue economy to reach R1.7 billion by 2033.

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Zuma’s speech in Durban : 19 July 2014:

South Africa is ideally positioned to serve the East-West cargo traffic and the booming African offshore oil and gas industry, through marine manufacturing, which includes ship and rig repair, refurbishment and boatbuilding. Of the eighty oil rigs estimated to be in the range of the Western Cape, only four rigs are serviced per year, showing significant potential for growth. As a solution, the marine transport workstream has developed eighteen initiatives across three categories, infrastructure and operations, skills and capacity building as well as market growth to accelerate sector growth. The initiatives will expand South African port capacity for repair work for oil ships and oil rigs. This is approximately eighty percent of current oil and gas imports. The result would be one hundred and thirty thousand jobs and a contribution of two point two billion US dollars (US $2.2 billion) to GDP. The Aquaculture workstream has underlined the high growth potential of South Africa’s aquaculture sector due to increasing demand for fish. In the spirit of Operation Phakisa and getting things done as quickly as possible, there is already progress on working towards an Oceans Act. We hope to have a draft Oceans Bill ready in 2015.

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FROM SOUTH AFRICAN PARLIAMENT

Parliament passed an amended petroleum bill in March that gives the state an automatic 20% stake in new gas and oil exploration ventures, a proviso that oil firms said at the time would have a “chilling effect” on investment. Jacques Roux, a consultant geologist at the state Petroleum Agency, said the estimates were “speculative resources”, meaning they were untested and mainly in deeper waters and were derived from analysis of rock structures and seismic anomalies.

>Statement on Cabinet meeting of 19 November 2014

Implementation of Key Government Programmes

1. Cabinet welcomes the launch of Operation Phakisa

2: Scaling up Ideal Clinic Realisation and Maintenance Programme. This follows Operation Phakisa 1 which focused on unlocking the economic potential of South Africa’s oceans. Operation Phakisa 2 seeks to improve the quality of care provided in 3 500 Primary Health Care facilities, consisting of government clinics and Community Health Centres. The expected outcomes entails transformation of the existing clinics and Community Health Centres into centres of excellence, which will be used by all South Africans, due to the enhanced quality of services they will provide.

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19 December 2014 : Zuma

We are also continuing to implement the National Health Insurance scheme at a number of pilot sites. The scheme is aimed at making access to health equal for all, regardless of class or financial means.

We have moved ahead with the implementation of the National Development Plan, (NDP), which has been mainstreamed into the government’s programme of action for the next five years.

One of the highlights of the year has been the launch of the popular NDP delivery programme, Operation Phakisa. The first segment of Operation Phakisa focuses on boosting the country’s ocean economy. We have also launched Operation Phakisa 2, aimed at improving the functioning of clinics. We have established a unique collaboration, with government working with business, labour, academia and civil society to make Operation Phakisa succeed.

We have continued to build much-needed infrastructure. Within the first 100 days of this fifth administration, 45 schools were completed. Eighty-one schools were provided with sanitation, 58 with electrification and 88 with water. In addition to three new universities that we are establishing in Gauteng, Northern Cape and Mpumalanga, sixteen sites have been identified for the construction of 12 new Technical and Vocational Education and Training College campuses.

We have taken measures to assist state owned enterprises that are facing difficulties such as Eskom, SAA and the SA Post Office.

Since 2008, South Africa has been experiencing regular disruptions in the supply of electricity, which is understandably a great source of inconvenience and frustration to consumers. This has come against the background of a highly successful electrification programme aimed at eradicating apartheid backlogs. To date we have connected more than 11 million households, double the number of households with access to electricity in 1994. From April to October this year, 131 089 electricity connections were concluded. Government has also facilitated electrical connections to boreholes in Ngobi village near Hammanskraal, ensuring safe water supply to 1261 households, benefitting about 5000 people. Current interruptions in some parts of the village caused by technical problems are being attended to.
Government is working hard to make Medupi and Kusile power stations come onto the grid faster to promote energy security. We are also licensing independent power producers while exploring various energy options including coal, gas, nuclear, solar and renewable energy options. Government has also entered into several negotiations with nuclear vendor countries and has recently signed Inter-Governmental Framework Agreements with the Russian Federation, the French Republic, the People’s Republic of China, the United States of America and South Korea as part of the nuclear exploratory process.

To improve water connections, a stand-alone department of Water and Sanitation was established in May this year and some progress is being made. This year, the number of bucket toilets eradicated in the five most affected provinces are as follows; Free State 6021, Limpopo 777, Eastern Cape 1675, North West 379 and Northern Cape 2694. The work continues as in formal areas, the bucket sanitation backlog remains estimated at 88 127and at 185 000 in informal areas.

Water utilities have been directed to assist in water provision in distressed communities. Sedibeng Water was appointed in October 2014 to provide water services to Ngaka Modiri Molema District Municipality. Amatole Water was directed to implement a refurbishment plan and to bring the systems into full operation to serve Makana District Municipality in Grahamstown and surroundings. Rand Water has taken over Bushbuckridge Water to improve the supply of water in the Mpumalanga area.

To relieve the water shortage caused by drought in the Free State, water had to be released from the Lesotho Highlands Water project into the Caledon River, thus benefitting towns in the Setsoto and Mohokare Local Municipalities.

In October, we celebrated the provision of water to 55 villages in Giyani in Limpopo, which has changed people’s lives dramatically in the area. Life will soon change as well for 16 200 households in Umkhanyakude District in KwaZulu-Natal. For the first time in 30 years, they will get water from Jozini Dam, which was built in 1973 for agricultural use.

Government has set aside R2.4 billion to assist in the delivery of over 200 000 houses for mining employees over the next two years. In addition, a programme has been launched to facilitate the training of 2000 young people for careers in the property sector in 2015/2016. We have also launched a three year National Military Veterans Housing Programme to clear the backlog of close to 6 000 military veteran households who require accommodation.

For basic services to be provided efficiently, local government has to improve in every part of the country. We hosted a Presidential summit on local government in September this year and launched the now popular Back to Basics local government campaign.

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JANUARY 2015 ZUMA

President Jacob Zuma will be promoting South Africa’s National Development Plan (NDP) in Davos-Klosters, Switzerland for the World Economic Forum meeting, which the Presidency says has been designed to boost inclusive growth and development. We are ready to communicate our country’s successes and also to share our plans to deal with the challenges that we face,’’ .

A statement by the presidency says that in 20 years of democracy South Africa has recorded substantial achievements in improving the living standards of citizens, especially the poor who had been excluded and marginalised during the period of apartheid. The NDP aims to eliminate poverty and reduce inequality by 2030. Yet despite its successes, the presidency has admitted that South Africa’s journey to prosperity is still not complete given the huge legacy of apartheid.

The country is expected to market its identified six job drivers that are designed to achieve much-needed growth with decent jobs. These are: infrastructure development, agriculture, mining and beneficiation, manufacturing, the Green Economy and tourism, respectively. South Africa is also expected to market the new flagship project, Operation Phakisa, especially the component dealing with promoting the ocean economy.

Various related articles regarding the problems of this legislation – consequences on the gas and industrial businesses, rights, etc.
http://www.sabinetlaw.co.za/mining-and-energy/legislation/mineral-and-petroleum-resources-development-amendment-2013

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Bill news, not signed yet

Most political parties are fully aware of the consequences, from the beginning they supported the government with all legislation and policies. On 12 March 2014, the National Assembly (NA) passed the Mineral and Petroleum Resources Development Amendment Bill, 2013 (Bill) by 226 votes to 66. The Bill amends a number of key provisions of the Mineral and Petroleum Resources Development Act, 2002 (MPRDA). It represents the most significant and far reaching changes to the MPRDA since its promulgation in May, 2004.

The Bill itself has been amended four times since its original version was published for public comment in December, 2012. The most significant amendments were made during a meeting of the NA’s Portfolio Committee on Mineral Resources on 7 March 2014, which produced the final version of the Bill (recent amendments). The Chamber of Mines, which was consulted on the recent amendments, has expressed its satisfaction with the final version of the Bill, indicating that these address many of the Bill’s original shortcomings.

The Bill obliges the Minister of Mineral Resources to “initiate or promote the beneficiation of mineral resources in the Republic” and requires the Minister to “designate any mineral or mineral product for local beneficiation”. The Minister is granted wide discretionary powers, under the amended Section 107 of the Act, to determine the “terms and conditions applicable to beneficiation of mineral resources as contemplated in Section 26” as well as to “publish such conditions required to ensure security of supply for local beneficiation in the prescribed manner”. Beyond this, the Minister’s discretion must now be guided by reference to “national development imperatives”. These are described in Section 26 of the MPRDA, as amended, as including “macro-economic stability, energy security, industrialisation, food security and infrastructure development”. The Bill was tagged by Parliament’s joint tagging mechanism as one under Section 76 of the Constitution of the Republic of South Africa. A bill which is tagged as such falls within the functional areas of concurrent national and provincial legislative competence under Schedule 4 to the Constitution. Accordingly, under Section 76 of the Constitution, the Bill has now been referred to the National Council of Provinces for further consideration.

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There is also an indication and possibility that the Bill be referred back to Parliament:

There is a chance that the Minerals and Petroleum Resources Development Act (MPRDA) Amendment Bill may be referred back to Parliament, Mineral Resources Minister Ngoako Ramatlhodi said on Wednesday. At a media conference at the Joburg Indaba, Ramatlhodi said in response to Mining Weekly Online that the potential for refer back had been heightened by the contention that oil and gas legislation should be separated out of the MPRDA legislative framework and accommodated within its own legislative framework. The Minister said that he had been personally convinced by the oil and gas sector that oil and gas should have its own legal framework.

At the same time, he said that the Chamber of Mines had agreed to the MPRDA Amendment Bill in its current form and would like to see President Jacob Zuma sign the Bill into law as its stood. President Zuma said in response to a Parliamentary question by Opposition MP HC Schmidt that he had written to the Speaker to seek her advice regarding the demand of the Democratic Alliance that the Bill be referred back to the National Assembly to facilitate the required public involvement as laid down in the Constitution. Earlier, in delivering his opening keynote address, Ramatlhodi described the South African mining industry as the alpha and omega of the South African economy.

“It shaped our past and continues to define our future,” he said, adding that the cost to the industry and the economy of this year’s five-month strike in the Rustenburg platinum belt had been so severe that it was beyond words. In expressing gratitude to those who helped to find resolution to the strike, he said South Africans were a nation able to overcome the most insurmountable problems through dialogue. “We take pride in our nation being blessed with the unique gift of being able to solve our problems through dialogue,” he said.

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Gas exploraton in the Oceans

In a speech to senior South African and Malaysian officials in the port city of Durban, Zuma said the government wanted 30 exploration wells drilled in the next 10 years. “Over the next 20 years, this could lead to the production of 300 000 barrels of oil and gas per day,” Zuma said, adding that the industry needed a legislative framework that would benefit both South Africa and participating firms. Much of the exploration effort in South Africa is being spurred by the recent discovery of massive natural gas reserves off the coast of neighbouring Mozambique and Tanzania in east Africa. Zuma said 9 billion barrels of crude was equivalent to 40 years of South African oil consumption, while gas deposits could amount to as much as 11 billion barrels of oil equivalent, equal to 375 years of consumption. French multinational Total started South Africa’s first deep-water drilling in July, in the Outeniqua Basin, 175 km south of the southern port of Mossel Bay. Australian junior explorer Sunbird Energy has been developing South Africa’s largest stranded gas field, Ibhubesi on the west coast, which has estimated reserves of 540 billion cubic feet of gas. Other offshore blocks have been allocated to state petroleum firm PetroSA, domestic petrochemicals group Sasol, and international majors Shell, Anadarko, Exxon Mobil and ENI, according to the Cape Town-based Petroleum Agency.

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During October 2014, Ministers Radebe, Nene and Davies all had joint meetings with Baroness Patricia Scotland, Prime Minister David Cameron’s special envoy on trade and investment with South Africa. The three Ministers also held joint meetings with the CEO and chairmen of Old Mutual and SABMiller and were hosted to lunch and breakfast by the head of PWC and the global leadership of Deloitte.

Addressing a group of mining and oil and gas investors, Radebe said that the fact that the Mineral and Petroleum Development Act had not been signed into law was to allow for adjustments to be made to ensure that the measure is in alignment with Operation Phakisa, the government’s accelerated development plan in the oil and gas sector. Phakisa means “Hurry Up” in isiZulu.

Minister Radebe told the innovaBRICS conference that BRICS had become “one of the most recognised groupings in the global economy” which now accounted for more than a quarter of global GDP and represented 43% of the world’s population and 40% of its currency reserves estimated at around $4.4-trillion (ZAR 44-trillion).

He said that BRICS’ New Development Bank would mobilise additional resources for global growth, infrastructure and sustainable development including projects such as the Square Kilometre Array, the Hydrogen South Africa initiative, the Fluorochemicals Expansion Initiative and the Titanium Initiative.

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Background and Promises (empty)

Government notes about the National Development Plan and other related information.

South Africa’s Constitution requires the protection, conservation and sustainable use of the marine environment. ▪ Section 24 of the Constitution provides everyone with a right to an environment that is not harmful to their health or well-being and to have that right protected through reasonable legislation and other measures that: (i) prevent pollution (ii) promote conservation (iii) secure ecologically sustainable development and use of natural resources.

Ministerial Committee and Secretariat to govern ocean activities

Case for change: There is no integrated ocean governance institutional framework to explain who does what and how stakeholders should work together effectively. There is no conflict resolution mechanism, although the Oceans Secretariat provides a means of resolving conflicts and finding trade-offs that will unlock the SA ocean economy.

Details:
 This institutional framework will govern the development, protection and monitoring of SA’s oceans
 We propose raising the profile of maritime and marine agenda by establishing a committee chaired by a Minister in the Office of the Presidency
 This unit will bring all relevant role-players and data together in meetings of the Oceans InterMinisterial Committee (OIMC)
 Each meeting will be chaired by the Minister within the Presidency
 Standing meetings will occur directly before or after cluster meetings
 A DG Oceans Forum (FOSAD) will use reports and data including marine spatial management plans to make decisions on trade-offs and facilitate joint-planning
 This data will be prepared by various Technology Working Groups which will convene on an ad hoc basis to provide expert input and research
 Areas already identified as initial priorities include: permitting, compliance, information systems, surveillance and MSP
 An Oceans Secretariat, consisting of a few core staff members supported by expert groups and housed within the DEA, will support the work of the technical committees and provide oversight and monitoring of ocean activities
 Relevant departments will retain their mandates and project management responsibilities
 Legislation will need to be amended to legislate this proposed ocean governance institutional framework as a permanent structure
www.operationphakisa.gov.za/operations
and Operation Phakisa ocean governance legal technical report

A target for the amount of land and oceans under protection (presently about 7.9 million hectares of land, 848kms of coastline and 4 172 square kilometres of ocean are protected)

South Africa has jurisdiction over a very large Exclusive Economic Zone (EEZ) of 1.5 mn km2. Extended continental shelf claims will double the size of its ocean geography if successful. With such a large jurisdiction, effective governance is critical but will be challenging given the size and complexity of our oceans. Currently, the sectoral approach only gives a partial picture and it difficult to achieve balance.
Effective ocean governance will need to identify and manage interdependencies across socio-economic aspirations and environmental integrity. The Marine Protection Services and Governance (MPSG) Lab aspires to implement an overarching, integrated governance framework for sustainable growth of the ocean economy that will maximise socio-economic benefits while ensuring adequate ocean environmental protection within the next five years by:

The initiatives will cost ZAR 1.7 bn over the next five years, 53% of which will come from already committed programmes. Implementation of all initiatives will be overseen by the Oceans Secretariat, with primary support from the Department of Environmental Affairs (DEA), Department of Agriculture, Forestry And Fisheries (DAFF) and Department of Science and Technology (DST).

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History

Exploration Rights to Soekor

In 1967, the government of the Republic of South Africa (RSA) granted to SOEKOR (Pty) Ltd (under exploration Lease OP26) the right to explore for oil and gas in the whole of the offshore region of the South African Coast including the OBDWLA (with the exception of the area under the now defunct OP8 – a five nautical mile coastal strip between Cape Town and the Wilderness). In 1994 the offshore region out to approximately the 2 000 m isobath was divided into licence blocks numbered 1 to 18 for the purpose of licensing acreage for oil and gas exploration.

In 1996, the SOEKOR Petroleum Licensing Unit, now the Petroleum Agency, was created with the prime function of attracting international exploration companies to prospect for offshore oil and gas. The OP26 Lease was transferred to the Petroleum Agency in October 2000. In May 2004, the Minerals and Petroleum Resources Development Act (Act 28 of 2002) (MPRDA) came into effect. The MPRDA makes provision for the appointment, by the Minister of Minerals and Energy, of a “designated agency” to perform the functions referred to in Chapter 6 of the Act. In June 2004, PASA was officially appointed as the designated agency.

Under the Act, PASA no longer sub-leases Blocks under OP26 and all open areas are relinquished by the Agency. All licences, permits and rights are now made directly with the State, with the Agency as the State’s nominated representative in the agreements. All existing sub-lease holders had until the end of June 2007 to convert to a new right in terms of Schedule II of the MPRDA.

In terms of the MPRDA, all applications for oil and gas exploration must be submitted as an application for an exploration right in terms of Section 79 of the Act to the Petroleum Agency SA. Section 79 (4) (b) of the MPRDA requires that an EMPr be submitted to the designated agency as part of an application for an exploration right. This EMPr is submitted to PASA as part of Shell’s application for an exploration right for the OBDWLA.

The Need for Further Hydrocarbon Exploration Under Prospecting Lease OP26, the Government of South Africa tasked SOEKOR (Pty) Ltd to search for and, if found, to produce viable oil and gas deposits, both independently or in partnership with foreign companies. Under the new government, the strategic exploration role of SOEKOR has fallen away, and exploration is now carried out by international and local companies that enter into prospecting sub-lease contracts. The main objective of further exploration is to ensure the optimal development of the natural oil and gas potential of the Republic of South Africa. Current interest in exploration in South Africa by experienced international exploration companies, in the face of a very competitive market for exploration acreage, indicates that the potential exists in the South African offshore for commercial oil and gas discoveries, which will be to the benefit of both the country and its people.

Financial Provision

The South African government requires certain financial provisions from exploration companies as set out in Section 52(2)(d) of the Mineral and Petroleum Resources Development Regulations (R527) for exploration activities. In terms of Section 53(1) of the Regulations financial provision could be provided by one of the following methods:

an approved contribution to a trust fund;
• a financial guarantee from an approved bank;
• a deposit into a specified account; or
• any other method as the Director-General may determine. (Due to the nature of offshore exploration, Petroleum Agency SA has made provision for insurance cover for seismic survey and well drilling exploration activities in terms of the MPRDA.)

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There will be an impact and hreat to the environment

Last month President Jacob Zuma announced the launch of Phakisa, based on a Malaysian model for fast-tracking economic development. Phakisa would, in its first phase, focus on the coastal economy. Now environmental activists want the Petroleum Agency of South Africa (Pasa), to which oil giant ExxonMobil has applied for exploration rights, to force the company to go back to the drawing board after allegedly negotiating in bad faith. “Seismic testing is being challenged by scientists around the world because of its impact on ocean life. There is an understanding around the world that oil exploration is damaging to the environment. We believe there will be accidents and spills and that these will damage our coastal economy – which so many people depend on for survival. It will also destroy our tourism industry, which helps drive our economy,’’ he said.

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